Keith Rabois’s Advice For Angel Investors

Venture Stories

Podcast Notes Key Takeaways The hardest part of angel investing is filtering and narrowing through opportunities to find the ones that are worth investing inEven Keith isn’t perfect at filtering which investing meetings to take. He’s missed out on several meetings with startups (like Pinterest and Coinbase) that ended up doing extremely well.As an angel investor, you want to have companies that fail in your portfolio because if none fail, that means you’re not taking enough risks. Investing in startups is all about finding extreme outliers–high risk leads to high reward.There are many reasons to become an angel investor:It’s a great way to learn about startups and the VC businessYou can invest in companies because you love their product or mission and want to grow itYou can invest in people you respect or believe inIt gives you access to a company with the possibility of working there laterIf you’re a new angel investor, focus on finding the coolest companies and getting deals with them without worrying too much about the priceOnly once you’ve built up a track record as a successful investor can you have more influence over the price in a dealWhen evaluating a founder’s LinkedIn profile, you want to look for a constant increase in responsibilities. People that want to change the world usually aren’t sitting still but instead trying to grow and have as much impact as possible.Two trends Keith is watching carefully: the decentralization of contentthe disruption of higher education

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Keith Rabois (@rabois), partner at Founders Fund, joins Erik on this episode. It was recorded as part of an On Deck event. They discuss:

- How he would compare the state of angel investing when he was getting started years ago to angel investing today.

- His learnings about building a better filter for whether to take a meeting or not, and what he looks for in a person’s LinkedIn profile.

- Portfolio allocation and how much to allocate to angel investing.

- What differentiates people who are an executive and angel versus those who are full-time VCs.

- Whether he plans to invest in crypto.

- Thoughts on pricing and the differences in pricing considerations between angels and VCs.

- How he uses Twitter.

- Trends he sees and ideas he’s exploring.

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